Home sellers in London have raised asking prices to record levels, as they want to benefit from the scrapping of disclosure rules and tap the property market recovery, said Rightmove plc.
The average asking price for homes in the capital city increased 2.2 percent this month to £429,597 (S$878,250) over the previous month, the operator of the country’s biggest property website said. Prices rose for a sixth month in the UK as a whole, surging 0.3 percent.
Demand for homes has withstood economic uncertainty in the UK and the growth in supply that was brought by the end of Home Information Pack (HIP) requirements for marketing properties.
Rightmove said the market recovery may still weaken because mortgage approvals remain at only 50 percent of the 2007 boom and as tax increases and budget cuts loom.
"There is a bit of a post-HIP party atmosphere, with estate agents glad to restock their shelves and new sellers willing to give moving a go with fewer cost commitments," said Miles Shipside, commercial director of Rightmove. "This pent-up enthusiasm to sell will tail off to a degree, though if it continues those who are serious about selling will have to consider reducing their prices."
James Gubbins, a property agent said that the abolition of HIPs has greatly helped him shift properties that would have languished unsold.
"We wouldn’t have been able to move as quickly had there been a HIPs requirement, the buyer would have gone off and bought something else," he said. "We’ve still got an imbalance between supply and demand, and that’s sustaining prices."